Somali Fraud

There is a moment when every news story either achieves lift-off or tumbles back to the earth. Having covered a few that drove national headlines, I’ve discovered there is no universal formula for which ones hit the stratosphere, and which do not.

Our recent story detailing Minnesota’s Somali fraud rings has been one of the lucky ones, achieving liftoff in record time. City Journal reporter Ryan Thorpe and I summarized a decade of Somali fraud schemes that stole billions of taxpayer dollars, some of which ended up with Al-Shabaab terrorists back in Somalia. These were sophisticated criminal enterprises that exploited Minnesota’s generous welfare state, deployed accusations of racism to deter scrutiny, and looted the public treasury until local prosecutors did the hard work to bring them down.

The meta-story—how a news item weaves its way through public discourse—is also worth considering. When we published the story, it quickly dominated the conversation on conservative social media. It filtered upward to primetime Fox News, where, on Laura Ingraham’s program, I summarized the piece and called on President Trump to revoke Temporary Protected Status (TPS) for all Somalis in Minnesota.

Within hours, the president, who had been following the story, announced that he would revoke TPS for all Somali recipients. Then, over the Thanksgiving holiday, Trump raised the stakes with a blistering social media tirade that ripped into Somali fraudsters, accused Minnesota governor Tim Walz of mental deficiencies, and promised to stop all asylum cases and immigration from the Third World. This sequence of events turned the Minnesota fraud into the debate of the moment.

The next step in the process is for the liberal media to respond. Right on cue, CBS News published a story misrepresenting our report and “debunking” that misrepresentation—a claim that it eventually retracted under pressure. The New York Times did somewhat better, publishing a long feature on the Somali fraud, confirming key details, and opening

the floodgates for discourse on the center-left. The spotlight thus turned to Governor Walz, who was at the helm when Somali thieves robbed Minnesota of billions.

On the surface, the Times story was an acknowledgment that this was a real scandal that the liberal press had missed. But the paper did not address the underlying narrative about why the fraud happened. Yes, the story is about a criminal enterprise, but it runs deeper than that. The story has touched a nerve because it busts liberal myths about immigration, anti-racism, and the welfare state.

Minnesota has long prided itself on its generous welfare programs and reputation for good governance. But after the mass arrival of the new Somali population—many of whom brought with them different attitudes toward government and civil society—these programs became a weak point. George Floyd’s 2020 death in Minneapolis demonstrated that scrutiny could be deflected by making baseless accusations of “racism” against anyone who raised questions about the missing funds.

The uncomfortable truth for Times readers is that all cultures are not equal. Therefore, not all cultures are compatible with all political systems. In this case, the Somali criminal enterprise is incompatible with a generous welfare state, particularly in the context of a racial politics that intimidates whistleblowers and other honest brokers.

Though this story was particular to Minnesota, disruptive mass immigration is a national phenomenon. During the four years of the Biden administration, America imported millions of foreigners, many illegally. Some of these have brought, or are trying to bring, negative aspects of their home culture to the United States.

Indeed, cultural incompatibility was a campaign theme during the 2024 election.  Venezuelan gangs took over apartment buildings in Colorado. Haitian migrants overwhelmed deindustrialized towns in the Rust Belt. The Somali fraud story is another point in this plotline.

The Trump administration claims to be on pace to “shatter” records of forced deportations and so-called self-deportations, but more must be done. The administration should put financial restrictions on illegal immigrants, like requiring proof of legal status for maintaining a bank account; and implement

massive remittance taxes to reduce the profitability of illegal immigration and fraud. And it must line up the manpower to turbocharge the prosecution of immigrant fraud, in Minnesota and elsewhere.

The New York Times won’t spell it out in block print, but even devoted liberals are starting to ask questions about the welfare state’s combability with mass migration. The shocking scope and scale of the Somali fraud in Minnesota made this a story that could no longer be ignored.

 xxxxxxxxxxxxx 

xxxxxxxxxxxxxxxxxxx

xxxxxxxxxxxxxxxx 

........................

 

Karen Bass-Wei Huang-Jose Huizar

A video shared to X by @WallStreetApes shows a man standing outside the L.A. Grand Hotel in downtown Los Angeles, describing a city lease arrangement he said paid the hotel's owner, Shenzhen New World, $154 a night per room, regardless of occupancy.

He said the city leased the building starting in 2020 under Project Roomkey, later folded into Mayor Karen Bass's Inside Safe program, and claimed the city paid roughly $100 million to the company in total.

He also said that the occupancy at one point fell to 24 percent of rooms while the flat per-room rate continued.

The man also alleged without evidence that the arrangement functioned as a money laundering scheme benefiting Democratic donors and described Wei Huang as a Democratic donor. The claims couldn't be independently verified by the Daily Dot.

Reacting to the video, one commenter argued that fraud tied to city contracts frequently gets "laundered and smurfed into campaign donations," without offering supporting evidence for that specific characterization.

Another user wrote that they had experienced the corruption firsthand, "I notice this a lot in California. They don't even hide their obvious corruption because the LA Times and other media never bother to investigate any of it and the AG is part of their network of corruption."

The owner of L.A. Grand Hotel is Wei Huang, a billionaire who is also the owner of Shenzhen New World Group, according to the Justice Department. His company purchased the L.A. Grand Hotel in 2010. Prosecutors said Huang provided more than $500,000 to former Los Angeles City Councilman Jose Huizar, allegedly to help settle a sexual harassment lawsuit against Huizar in exchange for Huizar's support for the company's planned 77-story tower nearby.

Shenzhen New World was convicted in November 2022 on charges including honest services wire fraud and bribery, and was fined $4 million and placed on five years' probation in May 2023, per the same DOJ release. Huang was also charged but has not appeared in court. The Justice Department considers him a fugitive and believes he is living in China.

A third commenter raised additional questions about Huang's immigration history, asking whether he obtained a U.S. passport tied to his investments and whether he had children born in the country during his time here.

The Daily Dot could not independently verify the total lease payments beyond $8.7 million documented through mid-2023, the money laundering allegations made in the video, the $100 million payment claim, or any direct financial connection between Wei Huang and Democratic campaign donations. Confirmed details about Shenzhen New World's criminal conviction are drawn from Justice Department press releases.

Advertisement

 xxxxxxxxxxxxxxxx 

Kenya Croom-Larry Earl-A Step to Freedom

In recent years, the nonprofit A Step to Freedom has grown rapidly, collecting millions of dollars from the government to house and feed homeless people coming out of jail in L.A. County.

What was a small organization providing 20 or so men shelter each year, with $25,500 in revenue in 2018, grew to operate six interim housing sites serving about 200 people at a time in 2024, with more than $5 million in revenue, largely from taxpayers, according to federal tax filings.

The expansion enabled A Step to Freedom, run by chief executive Kenya Croom, to help far more people, but it also had another, less visible beneficiary: Croom herself.

According to a Times review of public and internal records, over three years, the nonprofit paid more than $1.7 million to Croom's two for-profit businesses that provided food for the shelters and, in its most recent tax filings, did not disclose her ties to them as required.

The nonprofit's most recent tax filing shows Croom made roughly $120,000 in 2024 for a 40-hour workweek leading A Step to Freedom. She said she earns an additional $100,000 salary from one of the for-profit companies.

Nonprofit experts interviewed by The Times raised concerns that someone in a position like Croom's could profit to the detriment of both taxpayers and the people the money is meant to serve.

In interviews, Croom defended the contracts, saying her companies provided meals, snacks and beverages to the nonprofit's roughly 200 residents at a lower cost than what outside vendors would have charged. She said the failure to disclose her role in the companies on the nonprofit's tax filings was an oversight.

"We didn't check a box. We made a mistake," she said, adding that the nonprofit is undergoing an audit. "We just have work to do. And our work to do here is really to help people."

Her chief of staff, Larry Earl, said in written answers to The Times that Croom did not participate in any discussions or votes about the board's decision to contract with her companies, in accordance with its conflict of interest policy.

Government spending on homelessness, which relies largely on nonprofits to operate shelters and other housing sites around L.A. County, is under immense scrutiny. Multiple audits have flagged a lack of oversight, while a task force of federal prosecutors have brought at least three fraud cases over the use of funds intended to help the homeless. Even after pouring billions into ending the crisis, it remains one of L.A. County's most intractable problems. Although the number of people living on the streets went down the last two years, the levels are still higher than they were in 2022.

Most recently, the head of a Hyde Park-based nonprofit, Abundant Blessings, was accused of spending millions of dollars awarded to his nonprofit to house and feed the homeless on luxury vacations, designer clothing and other personal expenses. Prosecutors said Alexander Soofer falsified invoices claiming he was serving fresh meals to residents while actually serving breakfast bars and microwavable ramen noodles. In another case, the former chief financial officer of affordable housing developer Shangri-La was accused of using millions that the state provided to create homeless housing toward his American Express bills, including transactions at luxury retailers. Both pleaded not guilty to the charges.

No such allegations have been made against A Step to Freedom.

Federal tax filings show that A Step to Freedom paid Croom's companies nearly $500,000 — $275,259 went to R&K Mgmt Firm Inc. in 2023 and $214,725 to ASF Solutions LLC in 2024, the most recent filing available. A transaction report provided by the nonprofit shows it paid ASF Solutions nearly $1.3 million in 2025 to serve three meals a day.

State business records show Croom filed paperwork to create both entities and holds roles at each. Croom told The Times she has an ownership stake in the two companies.

After The Times inquired with A Step to Freedom about its contracts with Croom's companies, the nonprofit disclosed "the potential issue" to one of its major funders, the county's Department of Health Services, according to a statement from Dr. Clemens Hong, the director of the department's Office of Diversion and Reentry.

County officials reviewed A Step to Freedom's payments to outside vendors during fiscal year 2024-25 and determined that meal services were part of its approved scope of work and that the cost per meal was reasonable. It did find that the contract with ASF Solutions constituted a conflict of interest, and mandated that the nonprofit "provide a formal disclosure statement to LA County identifying the nature of the relationship with ASF Solutions LLC."

The county identified three other companies that the nonprofit paid for unapproved work, deemed those payments conflicts of interest and asked the nonprofit to repay $82,800 to the county . Officials said three managers at the nonprofit signed contracts on behalf of the companies. It's unclear what roles the nonprofit's managers have with each of the companies.

Croom and Jimar Wilson, the president of the nonprofit's board of directors, did not respond to an email seeking comment on the county's findings.

In an earlier interview, Croom said A Step to Freedom previously prepared the meals in house, but with food and workers' compensation costs rising, the nonprofit's board of directors tasked her with finding a cheaper way.

Croom said the nonprofit initially contracted with an existing company that records show she had incorporated in 2021 — R&K Mgmt — to provide food as "proof of concept" that she could reduce costs before she established ASF Solutions in 2023 to take over food service in August 2024. She said she serves as president of ASF Solutions, from which she takes her salary, and that R&K Mgmt doesn't currently have any revenue and she doesn't collect a salary from the firm.

"The board and I came together to find solutions," Croom said. "One of those ways was to move our kitchen staff out of A Step to Freedom and to create an entity that could manage the food solutions."

A Step to Freedom declined to answer how much it cost to provide meals when it handled food service in house. But in an email, it said workers' comp costs were lowered because Croom's company is small and lower risk than the nonprofit.

Croom said the nonprofit sought quotes from outside meal preparation vendors but determined ASF Solutions could do the job for a lower price.

On a given day, she said, ASF Solutions provides three meals and snacks for the 200 people in the shelters for $18 per person.

The nonprofit prepared a vendor analysis for The Times comparing prices it said it received from the three other companies: It said Factor would have charged $30 per person for three meals a day, Thistle $24.55 for three meals and two snacks, and Everytable $18.45 for three meals.

Representatives for Factor and Thistle said they had no record of providing any quotes to A Step to Freedom. Everytable did not respond to a request for comment.

One nonprofit says it can provide food cheaper than ASF Solutions — when it keeps operations in house. Tyler Renner, a spokesperson for the homeless housing provider PATH, said the organization handles meals in house for about 200 people at a daily, per-person cost of $16.23 for three meals, snacks and beverages, relying in part on donated food.

The Times visited a PATH shelter for lunch recently, where it served Mediterranean chicken bowls with black beans, turmeric rice, cucumber, tomato, pickled onions, feta cheese and spring greens.

Under A Step to Freedom's contract with the Department of Health Services, the nonprofit is obligated to provide residents with a minimum of three nutritious meals per day.

Laurie Styron, chief executive of CharityWatch, said there can be an incentive for Croom's company to produce fewer or less-quality meals to have a higher profit margin. She and others questioned who would guard against such a scenario.

"The driver of a for-profit company is to maximize profit and the driver of a charity CEO is to provide the best services and to fulfill its mission," she said. "Those conflict."

"If you have chosen a vendor which is closely related to the CEO of the nonprofit, then who's the party that's ensuring that that vendor is living up to their end of the bargain?" said Brian Mittendorf, a nonprofit accounting expert at Ohio State University. "You would hope the nonprofit CEO isn't the one charged with that."

In a case like this, experts said, the nonprofit's board should solicit competitive bids from outside companies, and factor in price and quality to make sure the charity gets the best value.

A Step to Freedom declined requests by The Times to release minutes of any board meetings where contracts with Croom's companies were discussed or approved. Its conflict of interest policy notes that Croom "stands to benefit financially" from contracts between the nonprofit and the two companies, and calls on the board to conduct an annual review of the relationship to ensure the nonprofit is getting the best deal.

According to A Step to Freedom's website, Croom's sister, Kendel Croom, serves as the board's treasurer. Kendel Croom could not be reached for comment.

Tamara Robinson, who moved into one of the nonprofit's sites last year, said the organization has provided a "safe haven" that's changed her life, including by getting her on medication to treat her depression.

She described the meals as decent, but "they can be better."

"I don't eat here often," Robinson said.

The Times spoke with eight other current and former residents of A Step to Freedom, who all said they don't eat every meal at the nonprofit. Two people described the meals as "tasty" and "above average." Others were less impressed, with reviews ranging from "average" to "nasty."

Toby Keith, who lives at the North Hollywood location, said that "it's not the greatest quality of food" and that a few times he's found mold in his sandwich bread.

At the request of The Times, Keith documented the meals for a few days in texts and photos. One day last month, he said, lunch was a plain chicken patty sandwich, with no vegetables. Another day was sloppy joes and chips, he said.

Keith said twice he had shown up to eat dinner during the hourlong meal time to find the meals had run out. Once, he said, workers gave him a peanut butter sandwich instead, and the other time they had to go off-site to get another meal from their food provider.

Sopha Yem, also a resident of the North Hollywood location, said he too has shown up a few times to find meals had run out, but he tries to avoid eating there in the first place.

"The food sucks," Yem said. "It's dry and bland."